Our policy approach is in line with the new US Federal Reserve's (Fed) average inflation targeting strategy, the Reserve Bank of New Zealand (RBNZ) Assistant Governor Christian Hawkesby said in a statement on Friday.
Additional comments
“Sees 'a number of parallels' between the Fed and its own approach.”
“RBNZ stance is to allow inflation to run above target after a period of weakness.”
On Wednesday, Hawkesby had said that a lot of work needs to be done in order to achieve the monetary policy targets.
Market reaction
NZD/USD trades with sizeable gains and looks to retest the three-week highs of 0.6676 reached after Fed Chair Jerome Powell’s speech.
The sentiment around the kiwi remains underpinned despite the rally in the US Treasury yields. At the press time, the spot adds 0.35% on a daily basis to trade near-daily highs of 0.6665.
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